Petoskey council to consider endorsement of carbon fee

PETOSKEY — Petoskey City Council members might voice their support Monday for a federal “carbon tax.”

The measure, which is under consideration in the U.S. Congress, is known formally as the Energy Innovation and Carbon Dividend Act, and calls for a starting fee of $15 per ton on carbon emissions. That fee would be imposed high up the economic chain, at the point where the fuels enter the U.S. market.

Revenues generated from the fee would be doled out to American households in equal shares.

The website for the Energy Innovation Act specifically rejects the term “tax” in describing the proposed legislation because the revenue garnered does not stay in government coffers, but many commentators and media outlets still tend to use “tax” as an analogous shorthand for the regulatory strategy outlined in the proposal.

Petoskey City Council members became involved in the legislation when resident Ron Marshall brought it up at a recent meeting. He framed his statements around the context of Petoskey’s 2035 renewable energy commitment — which was up for a vote at that meeting — and argued that federal initiatives would be essential to the city achieving its goal.

“Besides promoting efficiency and health, this legislation helps our city by creating jobs, providing dividends to every household and to protect our businesses from unfair competition,” he told the council members.

Marshall asked the council members for an opportunity to provide a more thorough presentation on the measure at their next meeting and requested that they consider passing a formal resolution in favor of the bill.

According to city agenda materials, Marshall is expected to speak briefly at the City Council meeting, which begins at 7 p.m. Monday at city hall, 101 E. Lake St. At that same meeting, council members are likely to take a vote on whether they want to endorse the bill.

The legislation seeks to drive down fossil fuel use by disincentivizing it, thereby correcting what some deem as a superficially low market cost. It could also encourage innovation into new energy technologies. At the same time, the dividend payments are intended to ease the burden that such a market tool might have on individuals, especially middle- and low-income citizens.

Essentially, proponents of the bill argue that the continued use of fossil fuels has a variety of “externalized” costs that are not reflected in their price. At the same time, subsidies and tax breaks continue to keep the price of those fuels low, despite their consequences, supporters say.

The fee on fossil fuels, which starts at $15 per ton, would increase by $10 annually until greenhouse gas emissions decrease by 90 percent.